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“Turbo-Capitalism: Winners and Losers in the Global Economy” by E. Luttwak Report

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Updated: Nov 26th, 2021

The first thing that bursts upon the eye when you take the book “Turbo-Capitalism: Winners and Losers in the Global Economy” is its front cover that suggests the quotation from the book review by ‘Business Week’: “Luttwak’s work is a rigorous critique of a system that he believes will either evolve or collapse from its excesses …. The best thing about his books, whether you agree with him or not, is the agile, independent intellect at work with them. It makes him among other things, a superb social critic” (Luttwak, 2000, unpaged). Thus, there is no denying the fact that the book by this prominent historian, international strategist, and consultant suggests nontrivial theory that is, certainly, worth consideration. As it may be judged by the title of the book already, the work is devoted to the theory of “turbo capitalism”. Consequently, the thesis of the book may be formulated in the following way: human society should beware of the present state of capitalism, turbo-capitalism, which can bring very harmful results of its existence that will be very difficult to overcome because the feature of turbo-capitalism is that it is uncontrolled and, what is more, uncontrollable.

It should be stated that E. Luttwak defines the following features that are peculiar for turbo capitalism: deregulation and privatization, globalization. What he also stresses is the absolute and unquestionable victory of the computer that is unquestionable supporter of turbo-capitalism; the author eagerly devotes the whole chapter to it (Luttwak, 2000, p. 44). The retreat of the state is also typical of the economical and social system of turbo-capitalism. Finally, the strongest and the most evident feature of it that the author distinguishes is unhampered dominance of American model. As it has been mentioned above already, the author makes assumptions about the possible consequences of turbo-capitalism, defining them as the rise of inequality, the increase of poverty and crime. As the evidence for his theory, the scientist sets the example of “the Microsoft Mirage” (Luttwak, 2000, pp. 76-91). The main argument that may be observed in this section is that unemployment is caused by the limitedness of demand for employees in high-tech sector of industry. Illustrating his ideas, the theorist resorts to authoritative supporters, for instance he compares the new Titans of the Information Age, such as Sun Microsystems, Amgen, Cirrus, Intuit, etc. (Luttwak, 2000, p. 76) and the old ones: “General Motors, Ford, Boeing, Dupont and Kodak” (Luttwak, 2000, p. 76). The main criterion of the comparison is unemployment and stock market valuation. However, one peculiarity should be mentioned here: it seems that the author has chosen unsuitable basis for the comparison, very short time period that covers only 1990s.

As for the prescription for a better America, the author states that certain changes should be made in American tax system to make it more progressive and redistributive. Free trade is also considered as evil power by Luttwak, who asserts that it impoverishes workers. Deregulation is also a weak point that is very harmful for American society.

As for the examples from media sources that would refer to the book somehow, it is necessary to mention that Korten (1999) agrees with Luttwak saying that “economies and markets should serve societies” (unpaged). Luttwak (2000) pays special attention to Japan defining “full employment as the national goal” of the country (116). The newspaper articles prove his position stating that “lifetime employment is alive and well in Japan, with the state playing a big role in keeping it so” (Tabuchi 2009) and “It’s true Japan would not have achieved growth without government stimulus” (Tabuchi 2009). The same author also utters the idea that is synonymous to Luttwak’s point of view: Japanese capitalism is more “humane”, it is “capitalism that values employment and stability over growth” (Tabuchi 2009). Besides, there is information that proves Luttwack’s forecasts concerning unemployment in the USA that assesses it as “growing, 53.1” in comparison with Japan’s “46.6” “not growing”(Norris 2009). There are a lot of specialists who disagree with Luttwak’s idea about negative nature of globalization, such as Robinson (2009) who states that globalization “has been especially useful during the current economic crisis” (unpaged). While deregulation is condemned by the author, Samuelson (1997) presents opposing information about it, stressing that “protest and pain are unavoidable” but “benefits mount over time” (unpaged). Among possible negative consequences of turbo-capitalism, Luttwak mentions increase of crime and poverty. Though this information is proven by the example set by Bennett (2009), who states that “community is still poor” and “unemployment is more than twice the national average” but she is not so pessimistic about it.

On the whole, the book by Luttwak has a lot of supporters as well as opponents. This is the evidence of the fact that it has both: merits and drawbacks. One of the most evident merits of the work is its accessibility for everyone, the simple language and form used by the author. The unquestionable merit of the author’s work is reliable explanation of high rates of unemployment in Europe. Besides, the work abounds in smart ideas like the following one: “Nothing is more natural than the attempt of bureaucrats to find new justifications to keep their bureaucracies well funded” (Luttwak, 2000, p. 136). However, the weak points of the work can also be observed, such as, for instance, rather scant bibliography and unpleasantly unexpected absence of conclusion. The final statement says that “Turbo-capitalism, too, shall pass” (Luttwak, 2000, p. 237). This finale seems rather weak, a more valuable conclusion would sound better.

Reference

Bennet, J. (2009). Straight Into Compton. Newsweek. Web.

Luttwak, E. (2000). Turbo-Capitalism: Winners and Losers in the Global Economy. New York: Harper Collins Publishers.

Norris, F. (2009). Employment Looks Better. The New York Times. Web.

Robinson, K. Profiting From Globalization. The New York Times. 2009. Web.

Samuelson, R.J. (1997). A Bit Here, a Bit There, and Soon We’re Talking Big Savings. Say, $40 Billion a Year. Newsweek. Web.

Smith, P. (1999). The Trouble with Globalism. Business Week. Web.

Tabuchi, H. (2009). In Japan, Secure Jobs have a Cost. The New York Times. Web.

Tabuchi, H. (2009). Japan’s Economy Shows Signs of Improvement. The New York Times. Web.

Tabuchi, H. (2009). Japan Strives to Balance Growth and Job Stability. The New York Times. Web.

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IvyPanda. 2021. "“Turbo-Capitalism: Winners and Losers in the Global Economy” by E. Luttwak." November 26, 2021. https://ivypanda.com/essays/turbo-capitalism-winners-and-losers-in-the-global-economy-by-e-luttwak/.

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IvyPanda. (2021) '“Turbo-Capitalism: Winners and Losers in the Global Economy” by E. Luttwak'. 26 November.

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